Chinese firms allowed to take majority stake in new British nuclear plants

Investment must comply with rigorous safety standards, says George Osborne

British chancellor of the exchequer George Osborne (centre ) visits the Taishan nuclear power plant in southern China. Photograph: Bobby Yip/Getty Images

Chinese companies will be allowed to take a majority stake in new nuclear power stations in Britain, chancellor George Osborne announced yesterday.

Mr Osborne made the potentially controversial announcement as he visited the Taishan nuclear power plant in southern China at the end of his visit to the country, which has sought to repair ties damaged by a visit to Britain by the Dalai Lama.

The announcement is sure to raise questions about safety, and the British treasury said in a statement: “While any initial Chinese stake in a nuclear power project is likely to be a minority stake, over time stakes in subsequent new power stations could be majority stakes. Any investment from any country has to comply with rigorous regulatory standards for safety and security.”

CollaborationTaishan is a collaboration between French energy company EDF and the China General Nuclear Power Company. No specific project was mentioned, but Britain’s first nuclear power plant in 20 years is being developed by EDF in Hinkley in southwestern England. The move was “another demonstration of the next big step in the relationship between Britain and China – the world’s oldest civil nuclear power and the world’s fastest growing civil nuclear power”, said Mr Osborne.

“It is an important potential part of the government’s plan for developing the next generation of nuclear power in Britain. It means the potential of more investment and jobs in Britain, and lower long-term energy costs for consumers,” he said.

China has the world’s fastest-growing nuclear power industry. It relies on foreign technology for its generating stations but is trying to develop its own reactors and other equipment. Beijing needs to reduce its reliance on coal-fired power and cut air pollution, but the public is nervous since the incident at the Fukushima plant in Japan and people are sceptical of official assurances of safety.

In just over 20 years China has gone from having no working nuclear power plants to becoming the biggest nuclear power market in the world by reactors under construction, with 28 at the latest count, according to the International Atomic Energy Agency.